Amid talk of takeovers and January war chests, Rafa Benitez said this week that Newcastle United could threaten the top six with new investment - he’s not doing a bad job without such backing.

For sixth is the position in which his side now reside after Mikel Merino came from the bench to head an 86th-minute winner. The Spanish midfielder - a £6.5million addition from Borussia Dortmund - is perhaps the best example of the manager’s canny dealings with limited funds this summer.

Even still, this team is performing far better on grass than it looks on paper. Benitez agreed, as he said: ‘We came from Championship and didn’t sign too many players. So if you told me that on September 1 we would be here, I would say, “yeah, that's fine”.’

Mikel Merino rises highest above James McArthur and Jeffrey Schlupp to head past Julian Speroni and score the winning goal

Merino tugs on his Newcastle shirt after sending St James' Park into raptures with an 86th minute winner against Palace

Merino slides on his knees in front of the home crowd after netting the decisive goal past veteran Palace keeper Speroni

Substitute Merino is mobbed by his Newcastle team-mates after scoring the goal that took the Toon up to sixth in the league

That last line was delivered with a smile. Benitez knows he is exceeding expectations given what was a fairly unremarkable summer window, where just £40m was spent on six new players.

But that could change in the new year, should owner Mike Ashley get his wish and sell before Christmas.

Amanda Staveley - the financier behind a £300m approach from PCP Capital Partners to buy the club this week - was not here, as she had been for the last home match against Liverpool.

Her investment fund have entered the due diligence process but Staveley thought it best to stay away and not distract from events on the pitch. That was a shame, for the first 85 minutes were painful to watch and alternate viewing would have been welcome.

Referee Stuart Attwell shows a yellow card to Cabaye following the tackle, which could easily have been punished with red

As it was, the presence in the crowd of England boss Gareth Southgate and Geordie duo Sting and Jimmy Nail provided that diversion.

Former Palace defender Southgate would have been relatively impressed by his former club, who were the better side for the majority before that late concession.

The defeat, however, leaves them bottom and five points from safety. Not that new boss Roy Hodgson is panicking just yet.

‘Why should I not believe we can stay up?’ he said. ‘There are 29 games to go. We’ve beaten the champions last week and we’ve come to St James’ Park against a Newcastle side which is doing really well and, in my opinion, we matched them and were the stronger team.

‘So why should I not have belief? I will stop believing when the number of points we are behind doesn’t match the number of games that are left. Now that is not going to happen in October.’

Ayoze Perez battles for the ball in the air with Palace's defensive man mountain Sakho during a goalless first half

Yedlin is upended by Ivory Coast international winger Zaha at St James' Park as Matt Ritchie watches on from afar

Zaha reacts after being fouled as Andros Townsend attempts to calm his attacking team-mate down during goalless first half

Florian Lejeune eyes up Palace's Jeffrey Schlupp as he looks to maraud forward with the ball, towards the opponents' half

Newcastle goalkeeper Rob Elliot flies through the air after racing off his line to head the ball and clear the danger

Palace looked slightly more dangerous in an otherwise forgettable first half and Wilfried Zaha headed inches wide from an Andros Townsend cross.

At the other end there was one Christian Atsu shot which rippled the side-netting, but Newcastle lacked imagination and energy.

A set-piece was always going to be their most likely source of a goal and so it proved when Merino rose tallest to meet Matt Ritchie’s corner.

It wasn’t pretty but the Premier League table makes for good viewing today, just think what Benitez could do with ambitious owners behind him.

Newcastle fans show support for their team prior to the match with banners and flags, one with Rafa Benitez's face on

Roy Hodgson enjoyed his first victory as Crystal Palace boss against the champions Chelsea at Selhurst Park last weekend

Cabaye flicks the ball on as Joselu watches on closely; the ex-Newcastle man was booed throughout the afternoon

Palace hearts were broken late on in the north east when Merino rose highest to head into the back of Palace's net

Newcastle fans celebrate wildly after Merino netted his first goal for the club after signing from Borussia Dortmund

Merino is bundled over near the corner flag and looks delighted after scoring the only goal of a hard-fought match

England boss Gareth Southgate was among those watching, with Sting and Jimmy Nail sitting just one row in front of him